ASX 200 insurance brokers AUB Group (ASX: AUB) and Steadfast Group Ltd (ASX: SDF) have been excellent long-term investments.
Over the past five years, both companies have beaten the S&P/ASX 200 Index (ASX: XJO) by a wide margin.
While the ASX 200 has increased 47%, AUB Group and Steadfast have risen 106% and 81%, respectively.
Clearly, shareholders would have been very pleased to hold either ASX 200 company for the past five years.
But, are they still good investments today? And which company has a better outlook?
After reviewing both companies' FY25 results, Macquarie Group Ltd (ASX: MQG) provided its take on their outlooks for the year ahead.
AUB Group
AUB Group operates a global network of retail and wholesale insurance brokers, underwriting agencies, and risk services businesses. It has a wide presence, operating in around 579 locations globally, serving more than 1 million clients.
It operates under the following key segments: Australian Broking, New Zealand, Australian Agencies, and Tysers.
Macquarie was impressed by its FY25 result, suggesting the company "is executing well across multiple earnings growth opportunities, and industry conditions support earnings growth outlook."
Following the result, Macquarie affirmed its outperform rating on the ASX 200 stock and upgraded its price target from $35.45 to $37.40.
AUB Group also offers a current dividend yield of 2.77%.
Given that AUB Group shares closed at $32.85 on Friday, this suggests nearly 17% total upside over the next 12 months.
Steadfast Group
Steadfast is Australia's largest general insurance broker and underwriting agency network. It focuses on small to medium enterprise (SME) businesses.
The ASX 200 company has a track record of expansion through strategic acquisitions. Notably, in 2024, it acquired ISU Group, a major network of independent agencies in the US, and Sure Insurance, a specialised underwriting agency.
After its FY25 result, Macquarie affirmed its outperform rating on the ASX 200 stock and price target of $7.00.
Steadfast also offers a dividend yield of 3.27%.
Given that Steadfast shares closed at $5.96 on Friday, this suggests nearly 20% total upside from here.
Commenting on Steadfast's future prospects, the broker said, "The ability to maximise returns on a US roll-out is key to SDF's long-term value".
Foolish Takeaway
AUB Group and Steadfast have been excellent long-term investments. However, based on Macquarie's 12-month price targets, the broker believes Steadfast has slightly more upside. Steadfast also offers a higher dividend yield, which may increase its appeal for income-oriented investors.
